Millennials are snapping up Tesla after its layoffs

Tesla CEO Elon Musk on Friday sent a letter to employees, saying the company would lay off approximately 7% of its workforce due specifically to pressure on profits and the Model 3’s production challenges.

Shares have plunged 17% following the announcement, but investors on Robinhood, a free-trading app popular among younger traders, are piling into the stock.

Tesla shares have plunged 17% after the company announced it was laying off workers, and investors at Robinhood, a free-trading app popular among younger traders, are buying the dip.

According to Markets Insider’s weekly track of data, a net 15,870 Robinhood users added Tesla to their portfolio in the past week, making it the most-added stock on the app over that time. Tesla now has 97,404 Robinhood shareholders, ranking 20th among all stocks on the platform.

Tesla shares were hit hard after CEO Elon Musk on Friday sent a letter to employees saying the company would lay off approximately 7% of its staff – around 3,000 employees – due specifically to pressure on profits and the Model 3’s production challenges.

“Tesla will need to make these cuts while increasing the Model 3 production rate and making many manufacturing engineering improvements in the coming months,” Musk said.

“Higher volume and manufacturing design improvements are crucial for Tesla to achieve the economies of scale required to manufacture the standard range (220 mile), standard interior Model 3 at $35k and still be a viable company. There isn’t any other way.”

The past half year has been a roller-coaster ride for Tesla shareholders.

Tesla’s stock tanked to $250 in the wake of the go-private saga. It then managed to climb back above $350 after the company posted a surprise third-quarter profit thanks to strong revenue generated by its Model 3 sedan.

The electric-car maker is expected to earn an adjusted $2.20 a share on revenue of $7.07 billion, according to the Bloomberg consensus, when it reports fourth-quarter results on January 30.